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FTC Introduces New Orders For Intel; No Bundling
eldavojohn writes "Today a decision was handed down (PDF) from the FTC that underlined new guidelines for Intel in the highly anticipated investigation. Biggest result: the practices Intel employed, like bundling prices to get manufacturers like Dell to block sales of competitors' chips, must stop. No word yet on whether or not Intel will face monetary fines from the FTC like they did in Europe over the same monopolistic practices."
No more garbage intel GPUs for computers?
Does this mean an AMD Dell is on the horizon? Oh my.
While I always build my own computers, this could herald a huge increase in funding for AMD's research.
these machines have alot of components on one die now. (for instance GPU and CPU are in one chip as opposed to seperate chips)
so how does this work out?
no i didnt read tfa
The agency said Intel forced computer makers into exclusive deals and blocked rivals from making their chips work with Intel’s.
Forced? How'd they do that? Giving a customer a good deal doesn't mean they are forced into doing business. Intel showed a profit, so they weren't exactly dumping chips either. I think it's a good thing Intel "blocked rivals" from making compatible chips. While Intel was busy screwing up Itanium, AMD came out with a good 64-bit technology, which Intel is now using. That saved us all from having to switch to Itanium (thanks, AMD!)
How will this change? Intel knows how many systems Dell, HP and others ship. They don't have to sign exclusive deals, but they can sign "volume sales" deals. Where does the huge discount kick in? At X units (where X is just about what your total sales forecast is).
I need trepanation like I need a hole in the head.
FTC has no legal authority to impose monetary fine unless the agreement is broken.
What about the fact that PCIe interface is now REQUIRED for the next 6 years? That seems HUGE.
I hope nothing newer comes out in that time!
Plenty of companies sell AMD computers. The thing is they are usually their lower end line. The reason is that AMD just can't compete with Intel's products in terms of price, performance, and power usage on the higher end. Even now they don't have anything that is a solid Core 2 competitor, and Intel has moved on to the Core i lineup.
AMD's real problem seems to be that they only do budget well, and Intel does that ok too. You get in to midrange and up and it is all Intel all the time.
You obviously aren't familiar with the business practices that led to this ruling. Original Equipment Manufacturers (OEMs) like dell, hp, acer, lenovo, etc. get wholesale prices negotiated directly with Intel. It was suggested that if one of these OEMs was rumored to be in talks to offer an AMD proc system Intel would send a rep to advise them that they could no longer offer them preferred OEM pricing and the OEM would need to find a third party supplier to purchase their Intel chips in the future. Basically making the OEM buy their chips at retail prices. If you are looking at 20-30% increase in the cost of your primary component in an already tight margin product or shuttle your plans it's not hard to make that decision.
You also probably weren't aware of just how right your statement about the Itanium vs x64 was either. The Itanium was Intel's attempt to lock AMD out of the "clone" market because AMD didn't have a cross license to use the Itanium architecture. If the Itanium had succeeded there would no longer be a choice of processor for Intel based systems. Fortunately the Pentium 4 was a dog and ran very hot and consumed massive amounts of electricity. AMD meanwhile didn't rest on their laurels and came up with the x64 extensions which gave new life to the x86 line. Developers liked the x64 extensions because they didn't have to rewrite their code from scratch so it caught on quickly and Intel eventually licensed the x64 extensions from AMD.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
...we allow foreign companies to dump subsidized product in here and take money out. Why is it we have no problem emasculating our own, but when it comes to China's subsidized and unequal imports, our supposedly vicious FTC stands by like a mute paraplegic?
"take this exclusive deal or no intel CPUs for you"
"take this deal or all you get is last model celerons and atoms."
"Take this deal or we delay sending you the newest chips until launch, and you will be 3-6 months be hind your competition in getting something to market"
Take your pick of the above, all which would have destroyed Dell back in the day of P3s.
All of the above was encrypted with a Quad ROT-13 method. Unauthorized decryption is in violation of the DMCA.
If that's really the case, why aren't you putting a stop to carrier lock-in for cellphones? Some of those agreements are WAY more anti-competitive than any Intel contract ever was.
SJW: Someone who has run out of real oppression, and has to fake it.
Well, it is exactly what they did, and they were found anti-competitive for it. The point being that X should be the same for all the customers, as it is logical for a price governed by the manifacturing process. If it is not it only means that they are making you pay Intel because you sell many AMDs.
Why is it so obvious that I'm not familiar with it?
Here's the "inside" scoop, as I used to work for a large OEM who used Intel processors. We would work on an AMD solution, and let Intel see it, and then give us a better deal (which would allow us to cancel the AMD project...until next year). If you are correct, just talking to AMD would get us thrown off the Intel bus (pun intended).
Mod parent down -1, INCORRECT! (OK, since you realized how correct I was about Itanium, we'll let it slide)
I need trepanation like I need a hole in the head.
Sadly, the x64 extensions are built on top of a horrendously poor design, making x86-64 just that much messier than the default x86. At least some useless opcodes were deprecated in 64bit mode and the new prefixes are just some bits resulting in a dedicated opcode range rather than completely dedicated opcodes per prefix (tsk tsk Intel, tsk tsk tsk). I still say x86 should just die a horrible death and we should use something with a better design aimed at more modern hardware.
From TFA:
The agency said Intel forced computer makers into exclusive deals and blocked rivals from making their chips work with Intel’s.
Forced? How'd they do that?
Easy: Let's say Dell sells 50 million machine a year, and they are using 100% Intel chips. AMD wants to supply some of their business, and makes a bid to sell Dell as many processors as they can make (let's say 20 million). Dell wants to take the deal, and buy the remaining 30 million processors from Intel, but Intel informs them that if they do any business with AMD, Intel no longer supply processors for them (or will supply them at a much higher price than previously). Dell, faced with the choice of losing a supplier they must have to be in business, makes the only logical choice and doesn't buy from AMD.
On to your second point:
I think it's a good thing Intel "blocked rivals" from making compatible chips. While Intel was busy screwing up Itanium, AMD came out with a good 64-bit technology, which Intel is now using. That saved us all from having to switch to Itanium (thanks, AMD!)
"Blocking rivals from making compatible chips" isn't at issue here. Everyone does that; the x86 cross-licensing deal between Intel and AMD is unique among the industry. No one is saying that AMD should have been allowed to make an Itanium clone.
How will this change? Intel knows how many systems Dell, HP and others ship. They don't have to sign exclusive deals, but they can sign "volume sales" deals. Where does the huge discount kick in? At X units (where X is just about what your total sales forecast is).
Volume sales deals aren't illegal. Making your volume sales deal contingent on not doing business with a rival? That's a different story. In the example above, Intel would still be able to tell Dell that they would get a discount if they purchased 50 million processors, but AMD still must be allowed to say, "Hey Dell, we think you can sell 10 million extra units if you build machines around our processors". However, I don't know if the details of the FTC judgement would restrict this sort of volume deal for the duration of the supervisory period.
The point being that X should be the same for all the customers
There is no statutory or regulatory rules that says you can't give certain customers better prices. Companies do it all the time and face no legal issues by doing so.
If it is not it only means that they are making you pay Intel because you sell many AMDs.
If one was selling so many AMDs why would they care about losing their deal with Intel? If it was really as lucrative to sell AMD chips as people like to claim it would have been everyone would have just been exclusively using or heavily selling on AMD chips.
I always liked the specs on the ION, but ATOM seemed to have it locked with the cheaper bundled chipset. Maybe this will finally make them price competitive, and make Intel do descent onboard graphics for netbooks!
I used to work for a large OEM who used Intel processors.
As it happens I did as well and I am aware of the tactics you speak of. I am also aware of many other predatory practices Intel uses to strong arm it's OEMs but couldn't prove so I shall keep them to myself. Needless to say OEMs must work with the devil they know and that was one way they used Intel's tactics against itself.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
Can we have a similar ruling for Apple and AT&T please?
If Pandora's box is destined to be opened, *I* want to be the one to open it.
x86 exists because customers demand backwards compatibility; we're going to use it for as long as we have personal computers.
So you're saying Intel, being the owner of the merchandise, cannot rightfully decide for how much and under what terms they're sold?
Using a government-created monopoly, I might add. Without that, nothing would have stopped AMD from making clones.
Haha it's good to see corrupt business practices get the smackdown.
The FTC doesn't have the ability to levy fines, so there aren't coming from the FTC, see...
http://money.cnn.com/2010/08/04/technology/intel_ftc_settlement/index.htm
You cannot understand a world where it is more profitable to have a 20% AMD/80% Intel mix for a company?
There's one single argument in favour of Intel GPUs in the workplace :
They interact better with the Q series of Intel chipsets and are better supported by the "Intel AMT".
For those too lazy to read the Wikipedia article : AMT consist of a small system which is always accessible over the network even when the rest of the PC is off.
This small system can be used to do remote administration.
At its most basic form, it can be used to turn the machine on/off or choose from which medium to boot.
It can also do console redirection.
If the graphic card used is a discrete one from ATI or Nvidia :
- Only basic textmode redirection is possible.
If the graphic card used is the integrated Intel :
- Full remote access over a hardware-based VNC server located inside the chipset.
The point of all this is to bring the level of administration which was possible until recently on high-quality servers (I think Sun servers have been having it for ages), to the administration of desktop computer in enterprises.
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
Here is a good technical description of the actual terms:
http://www.eetimes.com/electronics-news/4205889/Intel-not-fined--agrees-to-restrictions-in-FTC-deal
Read it. All it does is require that Intel stop engaging in the monopolistic practices that it has been using for the last 10 years. So their punishment is that they have to obey the law for the next 5 years. They pay no fine. They don't admit that they did anything wrong.
The best part is at the very end of the article. This is where the juicy details are always buried.
Two million dollars to monitor a company a size of Intel for 10 years? Pathetic.
Despite the hype that the press will put out, this is a complete win for Intel. No fine. No one in the company is held responsible. No admission of guilt.
You have been getting ripped off for 10 years by Intel/Dell/HP in the form of higher prices and decreased innovation. Remember it was AMD that created the x86 64 bit architecture, not Intel. When Intel was paying bribes to Dell none of that money was going into R&D. The EETimes article makes it clear that Intel was modifying it's architecture to make AMD look bad, not to make any real world code run faster.
Your will not get a dime in compensation for the higher prices you have been paying. When you see figures that Dell paid $500 million in fines, or Intel paid AMD $1.2 billion to settle a court case, they are paying with money they stole from you, the consumer.
This settlement is a joke. Non of the people who profited will be held accountable or loose any real money. Consumers had untold billions of dollars stolen from them and the crooks got away clean. Welcome to our so-called capitalistic market driven economy, sucker.
Why is Snark Required?
Not quite.
There is AMD64 instruction code used today because of Microsoft and because AMD64 can run 32-bit x86 software. When AMD released the 64-bit opcodes, Intel didn't want to use them but Microsoft essentially told Intel that they are only going to write Windows for 1 64-bit processor and that will be AMD64.
In the past Microsoft had Windows for Itaniums, but Intel was not interested in moving these to PC market. Amd provided that solution and Microsoft forced it on Intel to use it.
Intel didn't do most of the things AMD accused Intel of doing, and lots of people have misinterpreted legal dealmaking as illegal dealmaking.
So unless you do have documented proof, I'm afraid we have to doubt you know of anything illegal that Intel did.
Balderdash.
Let's say Company X sells 100k computers a year. Let's say Intel offers them a discount of 10% if they order 20k or more processors, 15% if they order 40k or more, and 25% if they order 100k processors.
Now this company decides it's going to sell other computers using different products and drop their order down to 80k. Now, of course, their discount drops to 15%. This is a standard discount business process, and there's nothing wrong with it even for a "monopoly". Now, if the company still bought 100k processors and Intel dropped their discount because they _also_ bought other chips, you might have a point. Does anyone have any actual evidence of this happening?
"If the Itanium had succeeded there would no longer be a choice of processor for Intel based systems."
It's been a long time since the x86 could be called "Intel based". Intel and AMD have been sharing instruction-set extensions for a couple of decades.
So you're saying Intel, being the owner of the merchandise, cannot rightfully decide for how much and under what terms they're sold?
That's right. If you have a monopoly in a market, your right to set pricing terms are significantly restricted by the law.
The very prospect of this tactic being effective pretty much proves they have a monopoly. In any actual "free market", a threat to raise prices would result in the customer switching vendors. In the x86 market, there is no other vendor that can guarantee enough supply for big OEMs, so the threat is viable.
And yet x86 has stormed through the performance computing market leaving only very niche players. This is because nobody but a few nerds cares how nice the ISA is, and Intel/AMD have proven that they can can make it perform.
Sure. And now they're buying 20% fewer Intel chips, and any volume discount would be affected by that reduction in volume.
". The Itanium was Intel's attempt to lock AMD out of the "clone" market because AMD didn't have a cross license to use the Itanium architecture."
Itanium had nothing to do with AMD and everything to do with the belief at Intel's own leadership that X86 was an evolutionary dead end. Only after customers balked and fled to Opteron in the enterprise did Intel look at how to wring more life from X86. Intel overestimated both Itanium's performance and the willingness of the enterprise to undergo a wrenching platform change.
Life is hard, and the world is cruel
apple systems with amd cpus coming soon??
as they can make a nice low mini system with good on board video and give room for a $1000 mini tower as well.
cable tv and the cable box also cable card is a joke. No VOD, SDV needs a box to work.
You should be able to buy the box and not be foreced to rent it or rent a cable card and get VOD, PPV and all the other stuff that rented box get's.
so if you want usb 3.0 / sata 6 or any other add it it's cut video to x8 or use switch chips that still shear the x16 bus.
itanums biggest issue was that it ran 32-bit x86 code slow. Sadly, the world have built up such a inertia of 32-bit x86 code (especially by way of win32 ties) that anything short of a computing cataclysm (or a media corp funded inquisition) will be able to produce a quick upgrade as seen during the microcomputers.
then again, it may well be that for home computing, until we hit some kind of full sensory VR, there is little real need for a big upgrade. As such the most adaptable of markets have gone away, leaving corporations with their upgrade and maintenance forecasts and plans.
comment first, facts later. http://chem.tufts.edu/AnswersInScience/RelativityofWrong.htm
no bad it's locked to shit video that makes it useless next to the MS VNC and other VNC apps.
also for CAD work, VIDEO / PRO PHOTO work.
That was chipsets. AMD didn't really make their own chipsets. They had one, but it was not that good and didn't support many features (like higher speed AGP). So you had to turn to VIA for chipsets. Those were, to put it charitably, a fucking disaster. I remember getting an Athlon 700, fighting with it for a couple weeks before finally determining that was to way to make a GeForce work on the VIA chip. Took it back, got a P3 and had no issues.
It was an even bigger issue for OEMs because you could single source your stuff. With Intel, they'll make you the board, chipset, and CPU. This is useful because it means if there are any problems, it is the same company that fixes it. With AMD you had a different maker for each part, meaning if there was a problem you'd get a 3-way pointing match.
I'm sure Intel's stuff didn't help AMD, but that wasn't the reason they lost out. They did not provide what OEMs needed to make use of their chips. You can have the greatest processor in the world, but if the hardware that supports it is crap, you have a problem.
Co-op or cooperative advertising is a widespread practice. Basically a manufacturer covers all or much of the advertising cost for an ad that promotes the manufacturers' product(s).
Remember those Dell ads featuring "Intel Inside"?
(you should be hearing a few notes in your head about now...)
Is Intel now prohibited from paying anything towards vendor-specific ads?
If not, the DOJ hasn't gone far enough and left a major loophole.
Also, if my deal with you is based on not dealing with a competitor, that is over the line.
That said, it is openly ignored everywhere.
Would it be illegal if Intel just decided to close up shop and stop selling processors, and sell other kinds of chips? This is effectively raising the price of their processors to infinity, so that nobody can get them anymore.
Jane you ignorant slut.
FYI, not every company is a monopoly so they don't have the power to control the market and therefore are allowed to make those kinds of deals. Monopolies can not do that. Different game rules when you are a monopoly.
On that bit about AMD, are you kidding? Do you think HP is going to switch 100% of their Intel based systems to AMD? It's not so easy to just change and so many start with a few models first and grow into the product lines.
LoB
"Anyone who stands out in the middle of a road looks like roadkill to me." --Linus
Personally, I'm much more interested in the extent to which this decision will allow nVidia to make motherboard chipsets for current (post-Socket 775) and future Intel CPUs. Intel needs some competition in that space, and the market needs some chipsets for Core i(3-5-7-?) CPUs that have serious integrated graphics capability. I'd love to see, for instance, a motherboard that uses Socket 1156 processors with an integrated-into-chipset GT 240-class GPU in ITX form factor. That would be rockin for an HTPC/compact PC build.
The bit about shooting exclusives in the head is nice and all, but as a build-it-yourself guy, I've always been able to build an AMD-based system whenever I felt like it. Certainly the bulk of the market (which buys prebuilt systems) is more important, but we all care about what affects us personally the most :)
Everybody gets what the majority deserves.
That would be fine, because then Intel would no longer be obstructing other vendors from entering the market.
The point of antitrust laws is to keep a monopoly from leveraging their advantaged position to keep others from ever challenging the monopoly. Obviously, exiting the market altogether is not a tactic that would exclude other players. There might be a temporary price spike, but that would just draw more 3rd parties into the CPU market, and the prices would then return to normal.
What about Supermicro's 96-core 2U box?
Uhhhh dude? It works the same way it did with MSFT. You just tell them "Gee, it would really be a shame if we had to cut off these big fat kickback...errr "advertising checks" we have been giving you, along with having to raise your price for our wares 300% above your competitors." Just look at what Dell was offering when Netburst was the space heating pile of suck. Nearly every AMD OEM I saw then were ONLY the lowest of the low end Sempron chips, even though benchmark after benchmark had AMD slaughtering Intel, both on price AND performance. Do you really think that's a coincidence?
ACs don't waste your time replying, your posts are never seen by me.
But Microsoft can? Doesn't seem fair to me.
---- Booth was a patriot ----
Doesn't Microsoft force computer manufacturers to sell windows only? Why is this allowed? Or am I mistaken?
Except, of course, that nagging fact that Dell did decide to sell AMD processors and Intel continued to sell CPUs to Dell and provide volume rebates. Forced, eh?
"The defense of freedom requires the advance of freedom" - George W Bush
http://www.inminds.co.uk/index.html
Boycott Israel, boycott Intel -- it is that simple! The actions by Israel over the last 62 years and peaking with the aid flotilla when 9 lives were lost 5 people were shot and throw overboard and never seen again, 35 more were wounded, people were beaten up when in custody, $1M of electronic communications equipment and cameras were throw into the sea by the IDF... And the release of faked video footage... It too much and too many lies. It will never end until Israel is taken to task and one thing we can do is NOT BUY INTEL PRODUCTS.
The FTC lacks the legal authority to fine Intel unless they breach the terms of the FTC settlement.1 Also, the way this was brought as a section 5 investigation and not a standard anti-trust case had two major implications. One was that it allowed the FTC greater lattitude in what it could go after Intel for, but it also didn't create the opportunity for triple damages liability that a standard anti-trust litigation suit would have opened Intel up to.2 After a normal anti-trust case competitors can apparently go after the convicted for triple damages in certain cases. Not sure why that didn't apply to MS.
A company offering a product under certain terms is not ever obstructing anyone else from entering the market. It may be more difficult, but that's due to the behavior of the buyers, not the seller. The buyers ALWAYS have the ability to stop buying from Intel and buy from anyone else. It's really disappointing how little respect people have for property rights here on Slashdot.
Any "property rights" Intel has in CPUs are a fiction created by the government patent office. Likewise, antitrust laws are a fiction created by the government. It's all the same thing, but it defines how the system currently works.
The current laws on the books do not conform to your Randian property utopia. If you don't like the rules, lobby to get them changed.
You consider it a utopia to think that a person deciding what to do with his own physical property is a utopia? I'm talking about real physical tangible objects-you-can-hold property rights here (I've heard that Rand was an IP-advocate). If Intel wants to offer its real tangible physical processors-you-can-hold-in-your-hands for differing prices based on the behavior of the buyer, then so be it; the buyer is always free to decline buying from Intel.
That would be a good point, except that Dell did not sell AMD processors until their purchase of Alienware in 2006 (Alienware already had an AMD-based product line).
The FTC complaint is primarily aimed at behavior before that, especially around 2003-2005. During that period, AMD had a product that was objectively better than Intel's processors, but Dell did not use it due to the (alleged) pressure from Intel.
If you eliminated patents, you'd have a point.
Until then, Intel enjoys a monopoly, and it's not fair to let them set arbitrary prices on their physical chips, because nobody else can make them without Intel's blessing.
Intel's physical property exists only because of government meddling. Until that's changed, it's just as well that the government further meddle to mitigate the damage they've already done.
No disagreement. Sure nice how our patent system results in the government exerting centralized control of production and prices.
It'd be better if the government stopped creating artificial scarcity in the first place, so that no company could monopolize anything in the first place. More government interference will only make things worse for us.
Yes, forced.
Eventually Dell started to sell AMD chips.
However, there was quite a period of time where AMD could have been selling chips to Dell, and Dell was willing to buy but could not. You can read what the gp wrote again if that will help.
The market would certainly have looked a lot different if AMD had more cash for R&D instead of almost tanking.
Sorry that you have no concept of history but not everything can be viewed from a simple current state perspective.
Regards.
useless next to the MS VNC and other VNC apps.
Software applications have one big problem: they need to be executed.
So you only get a VNC using the MS apps or any other server (TighVNC, RealVNC, etc.) if the whole OS is running, and everything is configured correctly, including a setup networking card. You can use it to remote-help a user who is having difficulties with an applications and other such app-level assistance. But not much.
With hardware-based VNC, it's the Q-series chipset directly talking with the network chip and the GPU, by passing the OS, no matter what the CPU is doing. The CPU could even be off. (The whole machine is off, but you can still log into the Intel AMT service to turn it on, and then follow the boot process over VNC).
That means you can even remotely reboot the machine and install a full OS, including installing the drivers (Video and Network drivers).
Hardware-based VNC enables you to do more remote-admin, specially when the OS isn't setup correctly or isn't running.
The only problem is that the current solution from Intel is proprietary and restricted to their hardware. What we need is an open inter-vendor standard :
The same functionality could be achieved with a Killer-NIC type of network card (which has its own embed Linux running on its embed CPU). As PCIe bus authorises card-to-card communication, if there's a standard way to grab the video for serving it over VNC, a VNC server running on the Killer-NIC could grab video over PCIe and serve it, no matter if the main OS is functional or being installed.
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
I too used to work for an OEM that worked with both chipmakers. What is described by a few people above was very commonplace. But to be fair, I think it happens very often with a lot of companies. Who doesn't start talking to other vendors when the time to renegotiate your contract with your current vendor is approaching? One of the interesting things that I've heard about from others I know in the space is that Intel's budget for "co-branding" was a lot larger than AMD's. In other words, you run an ad in a best buy or Fry's ad with your new Dell or HP computer and mention that it has an Intel proc and display the Intel logo and they'd foot most of the cost for that ad. This is a perk that these processor manufacturers give to their OEM partners. As far as I know, AMD wasn't as liberal with their spending in this area. Is it illegal? I have no idea. But the company with the deeper pockets to help promote theirs and their OEM partner brands is going to easily help those manufacturers push more product containing their processors.